- Image courtesy of The Real Deal
Amidst optimistic reports that the economy has begun to turn around and rebuild after the massive housing bubble burst of 2008/9 there are still many feeling the aftershocks of negative financial impact.
One segment hardest hit in Florida is the Condo & Home Owners Associations that had been so popular with buyers in recent years. Unfortunately, with growing numbers of members defaulting on their loans or just refusing to pay their membership dues, other home or condo owners in good standing have had to endure higher fees and Associations have been limited in their recourse to recoup lost income. That is until now.
Thanks to Senate Bill 1196, HOAs and COAs have been given a little more latitude to “encourage” delinquent members to pay up. The bill was signed into law on June 1; it goes into effect July 1 of this year and should provide some much needed financial relief to struggling associations. It also includes “distressed condo relief” provisions that defer or exempt certain residential buildings from expensive upgrades.
Delinquent Fees
- Associations may suspend owner’s usage rights of common areas if they are overdue on paying a special assessment by 90 days. This doesn’t include access to the building unit (including elevators), parking or public utilities.
- Owner liability for unpaid assessments extended from 6 months to 12 and includes units in foreclosure.
- Associations may directly collect rent from tenants for future “monetary obligations” without the need for court action and is also given the power to evict tenants. However because there is no contract between a tenant and association, the effect of this is unclear.
- Associations are not responsible for ordinary landlord responsibilities like maintenance and upkeep on individual units.
- This bill will also allow homeowners associations, but not condos, to file a lien when fines reach $1,000.
Insurance
- An independent insurance appraisal will be required every 36 months at replacement cost.
- The requirement that the association be a named insured has been repealed.
- The option that associations may purchase insurance for an owner at owner’s expense for failure of owner to provide proof of insurance has also been repealed.
- Minimum coverage of $2,000 with maximum deductible of $250 per loss is now a requirement.
History of SB 1196:
Can the association tow your car out of your assigned parking spot over unpaid HOA fees?
Hi L, It’s difficult to make a determination on your situation without knowing more of the details; Associations establish their own documentation and none are exactly the same. Under the new Florida law they cannot prevent a unit owner from accessing their unit. However, they can prevent you from accessing common areas such as the pool or fitness centers; the parking situation is a gray area depending on the way their regulations are written. I would recommend seeking legal counsel concerning the towing of a car from an assigned parking space as an attorney will be able to assess the associations documentation and give you a definitive answer.
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We have a deadbeat owner that has refused to pay their quarterly fees for 3 years. Lien was placed as well the banks, and has been in foreclosure with many court extensions. This person is still living in the condo. Realizing this person does have revenues. How can we force this person from the unit??
Hi John, it sounds like you’ve done everything you can, at this point, on the financial end of things. Now is the time time seek the advice of legal counsel. Your attorney will be able to help you file the right paperwork to start the eviction process and get you moving toward a resolution to your problem. Best of luck to you!
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